North West Mining and Geology Group has agreed to subscribe to Meridian Minerals share placement announced earlier this month to maintain its 41 per cent stake in the company.
North West Mining and Geology Group has agreed to subscribe to Meridian Minerals share placement announced earlier this month to maintain its 41 per cent stake in the company.
On October 6, Meridian announced BZ Minerals had agreed to a $6.5 million placement to accelerate the completion of the Emanuel Range Feasibility Study on the Lennard Shelf project in the Kimberley.
Under the agreement, NWME had the right to contribute an additional $4.6 million at the same share price of 10.5 cents per share to maintain its interest in Meridian.
The combined placement from NWME and BZ Minerals means Meridian will raise a total of $11.1 million.
"Meridian's two largest shareholders, NWME and BZ Minerals, continue to show their long term support and provide the necessary funding to accelerate the completion of the Emanuel Range Feasibility Study and offer the opportunity to invest in other projects," said Meridian managing director Jeremy Read.
See company statement below:
The Directors of Australian resources company Meridian Minerals Limited ('Meridian' or 'Company') (ASX: MII) today confirm that Chinese company Northwest Mining and Geology Group Co Ltd. ('NWME') will subscribe for 43,797,119 shares at $0.105 per share (A$4.6M) and take up their full rights following the placement announced on 6 October 2010 to maintain their 41.34% shareholding.
On 6 October 2010, BZ Minerals (Australia) Pty Ltd ('BZ Minerals') agreed to a A$6.5M placement to accelerate finalisation of the Emanuel Range Feasibility Study on the Lennard Shelf Project in Western Australia's Kimberley region. Under the terms of an agreement signed in July 2009, NWME has the right to maintain its existing 41.34% interest in Meridian by contributing a further A$4.6M to the placement and retain its status as Meridian's largest shareholder.
The combined placement from NWME, BZ Minerals and Meridian will raise a total of A$11.1M at A$0.105 per share, in which NWME will have a 41.34% interest and BZ Minerals will have a 17.15% interest in Meridian.
Meridian's Managing Director Mr Jeremy Read said, "Meridian is delighted that NWME has chosen to take up its rights in the placement and retain their 41.34% shareholding. Meridian's two largest shareholders, NWME and BZ Minerals, continue to show their long term support and provide the necessary funding to accelerate the completion of the Emanuel Range Feasibility Study and offer the opportunity to invest in other projects."
"The placement which is at a premium to the market indicates that these two major cornerstone investors have confidence in not only zinc and lead, which are both now over US$1.10 a pound, but also in the Project where Meridian has consistently increased the mineral resources which have now more than doubled", said Mr Read.
The Company now has a solid shareholder base of institutions and high net worth investors who support the development of the Project and encourage management to investigate other project opportunities.
Following approval of the placement, Meridian's top 15 shareholders will account for more than 80% of the issued share capital (see table below).
Details of Placement
NWME will subscribe for 43,797,119 shares at A$0.105 per share for a total amount of A$4,598,697 to maintain a 41.34% interest in Meridian.
BZ Minerals will subscribe for 62,151,691 shares at A$0.105 per share for a total amount of A$6,525,928.
NWME will maintain its percentage interest in Meridian at 41.34% and BZ Minerals will have a 17.15% interest. As a part of the placement agreement, Binani Zinc Limited (BZ Minerals' parent company) has the right to appoint a Director to the Board of Meridian following completion of the placement.
NWME's participation will be subject to Chinese regulatory approvals, including the approval of the Chinese National Development and Reform Commission ('NDRC'). Completion of the placement to BZ Minerals is conditional on approval by the Australian Foreign Investment Review Board ('FIRB') and the Reserve Bank of India ('RBI').
See company statement below:
Queensland-based Meridian Minerals has announced a $6.5 million placement to BZ Minerals to accelerate the completion of the Emanuel Range Feasibility Study on the Lennard Shelf project in the Kimberley.
The placement to BZ Minerals is priced at 10.5 cents per share, a 22 per cent premium to the closing share price on October 4.
Under the agreement Meridian's largest shareholder North West Mining and Geology Group has the right to contribute an additional $4.6 million at the same share price to maintain a 41.34 per cent interest in the company.
Meridian's managing director Jeremy Read said: "Meridian is extremely pleased to have such strong support for the Lennard Shelf Project from international zinc industry participants BZ Minerals and NWME."
"Given that the placement is at a 22 per cent premium to the share price, this support recognises the significant progress that has been made on the Project to date with total mineral resources increasing 90 per cent since November 2009, as well as the long term potential for lead and zinc prices," he said.